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AMAG Pharmaceuticals, Inc. Message Board

  • xwavve xwavve Jun 2, 2009 7:11 PM Flag

    AMAG Market Cap Estimate

    1) US Feraheme sales at yr 5 = $1.2 billion

    2) Market cap sales multiple (2.5 x sales) = $3 billion

    3) Shares outstanding 17,000,000

    4) Label = full spectrum CKD

    5) Reimbursement = temporary J code, mid-margin reimbursement dialysis chains and institutions

    6) Price = $1.3 Bil x 2.5 mult divided by 17 mil share float = $177

    7) For emphasis: Price per share = $177

    Conservatively does not include:

    1) ROW sales for Feraheme
    2) Revenue from imaging pipeline

    Comments: A) This stock, in my opinion, looks like a strong candidate for a 2 for 1 stock split upon approval, and more likely, a 3 for 1. B) analysts are being very conservative in their projections -- it is a function of the small share float - you see the $55 per share price, and believe it is fully priced, when in actuality it just appears that way due to the paucity of shares. C) A typical baby biotech would have a share float of 60 million moving into commercialization. HERE IT IS 17 MILLION - TINY.

    Bottom-line: $177 per share. Now, assuming a split 3:1, that would be $59 per share -- that doesn't seem far fetched. And, the share float at 3:1 = a paltry 51 million. If the stars and planets align here -- it may seem a stretch - but those are the calculations. These are the situations that get me going -- the analysts projections are way off. How can you value a company at $75 per share post approval, or $1.3 billion -- it would be trading for less than cash at peak. Please do your own DD -- just my thoughts.

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